Dee Smith On the Collapse of the Rules-Based Order

Episode Overview

• This episode features intelligence analyst Dee Smith, who argues that the stable "rules-based order" of the post-Cold War era has collapsed, ushering in a dangerous period of global fragmentation.
• The discussion frames the current moment as a "polycrisis," where economic volatility, geopolitical conflict, and technological disruption amplify one another, making traditional forecasting models obsolete.
• It explores the transition from a unipolar world to a chaotic multipolar reality, examining how nations are shifting from "soft power" diplomacy to "hard power" coercion and "friend-shoring."
• Essential for leaders and investors, the content explains why reliance on efficiency is dangerous and why building resilience against "black swan" events is now the primary mandate for survival.

Key Concepts

• Intelligence vs. Geopolitics Unlike academic geopolitics which studies broad theoretical trends, intelligence analysis is holistic and predictive. It requires connecting disparate data points—weather, economics, sociology, and politics—to reduce uncertainty. You cannot understand the current world by looking at economics or politics in isolation; they must be viewed as an interconnected system.

• The "Polycrisis" and the Hobbesian Shift We have moved from a stable global order to a "Hobbesian" state—a war of "all against all." This is defined by a "polycrisis" where multiple instabilities occur simultaneously. The post-WWII period of peace was a historical anomaly; we are now reverting to the historical norm of instability, where "might makes right" and the weak can asymmetrically attack the strong.

• Zero-Based Analysis In a rapidly changing environment, relying on historical data or the "recent past" to predict the future is a liability. Analysts and leaders must practice "zero-based analysis," which involves looking at current data objectively without the cognitive bias of assuming stability will continue.

• The Weaponization of Interdependence Global connectivity, once seen as a guarantee of peace, has been weaponized. Everything from finance and trade to migration and information is now a tool of statecraft. This has forced a shift from "Just-in-Time" efficiency (lowest cost) to "Just-in-Case" security (resilience and redundancy), often called "friend-shoring."

• The Gamification and Abstraction of War Technological advancements have removed the "human friction" from warfare. Drone strikes and cyberwarfare abstract the reality of violence, making decision-makers more likely to escalate conflict. Furthermore, the generation of leaders who witnessed the horrors of nuclear capability is passing, increasing the risk that nuclear deterrents will fail due to a lack of visceral historical memory.

Quotes

• At 1:25 - "We look at things holistically... We're intelligence analysts. And intelligence analysis is different from academic political science or that sort of thing. It's really about trying to see how everything connects." - Smith establishes his methodology, emphasizing that understanding the world requires connecting dots across disciplines rather than viewing events in isolation.
• At 5:45 - "The problem with asymmetric warfare is that the weak can attack the strong effectively. And that changes the calculus of deterrence." - Explains a critical shift in strategy where traditional military superiority no longer guarantees security, as smaller entities can inflict significant damage through unconventional means.
• At 9:15 - "We're seeing the weaponization of everything. Trade, finance, migration, information... everything is now a tool of statecraft." - Identifying a major trend where non-military aspects of life are being used as leverage in geopolitical struggles, expanding the scope of conflict beyond the battlefield.
• At 12:30 - "You can't just look at the economics. If you look at the economics without the politics, you're going to get the wrong answer. If you look at the politics without the economics, you're going to get the wrong answer." - Highlights the necessity of an interdisciplinary approach to understanding global events, rejecting the siloed thinking that often leads to poor forecasting.
• At 17:50 - "The Global South is not a bloc. It's a group of countries that have shared interests but also very different interests. And they are transactional." - Correcting a common misconception, clarifying that these nations act based on specific self-interest rather than ideological unity against the West.
• At 22:30 - "It's a game of multi-dimensional chess with very high-risk stakes and you know, if you push too far, somebody will—it will start a war. And that's the danger, is that that could easily happen." - Explaining why small diplomatic escalations can lead to irreversible conflict in a system lacking guardrails.
• At 26:55 - "I think the pricing of gold is a really interesting thing because it has its own intelligence in a way... it's been telling us that things were going to happen for some time now because there hasn't been any reason for it to have been as high as it's been." - Using market indicators as predictive tools for geopolitical stability when official narratives may be unreliable.
• At 32:20 - "My generation is the last generation on both sides that has walked the field of a nuclear explosion and seen what it does... when we're gone, it's going to become much more likely that nuclear war happens again because it was never going to happen as long as you had people in control who knew what the consequences were." - A chilling perspective on how the loss of direct historical memory increases global risk.
• At 41:15 - "One little thing can, you know, overbalance something and set it off. But... back to the future, that's the way the world has always been really, except for this period of the last 70 or let's say the 60 years after World War II." - Contextualizing current instability not as a new phenomenon, but as a return to the historical norm of human civilization.

Takeaways

• Abandon Linear Forecasting Models: Stop assuming that tomorrow will look like yesterday. Adopt "Zero-Based Analysis" to assess risks based on current realities rather than historical trends, accepting that uncertainty is now a permanent feature of the landscape.
• Prioritize Resilience Over Efficiency: In business and strategy, shift focus from "Just-in-Time" supply chains to "Just-in-Case" redundancies. The cost of security is now higher, but the cost of fragility in a fragmented world is fatal.
• Watch "Silent" Indicators: Pay attention to market signals like the price of gold or troop movements rather than diplomatic rhetoric. These often reveal the true state of geopolitical tension before it hits the news.
• Integrate Political Risk into Economic Strategy: Do not make investment or business decisions based on economic data alone. You must overlay political and geopolitical analysis onto every financial decision to get an accurate picture.
• Prepare for "Irrational" Actors: Recognize that the "rules-based order" is gone. Nations and non-state actors will increasingly act in transactional, aggressive, or asymmetric ways that may seem "irrational" by Western standards but are consistent with a "might makes right" worldview.